To do business in China (as with lots of Asia) the company has to be majority Chinese owned. So typically they are a subsidiary with limited investment, owned by friendlies. This company was a marketing company for ARM in China, basically a few marketing men in an office.
China (the board members connected to the Chinese government) have ejected him. This is not a Chinese takeover of ARM, its a rogue employee.
After he was sacked, all the revenue he hijacked is theft. Any money he's taken from the company is theft.
Likewise any contracts he signed on behalf of the company are voided, the seal works only for China, and those companies sell their products abroad. He is not authorized to sell those licenses.
Presumably he realizes that as soon as he hands over the seal, he faces some major legal problems, and likely jail time.
So I assume he's trying to force a settlement in his favor by furthering this crap. But it won't work. He's done too much damage here I don't think the Chinese board can simply ignore what he's done.
I think at this point, it has to go to court, and they (the Chinese) have to make an example of him.
There's no sense in which a company's manager can seize ownership of the company by stealing the company seal and helping himself to company funds. It's not his company, those are not his funds, and he is in defiance of the Board (which includes a lot of high ranking Chinese officials he's defying).
It's a criminal matter at this point. No longer civil.